Commonwealth Bank of Australia (CBA) has partnered with crypto exchange and custodian firm Gemini and blockchain analysis company Chainalysis to become the first Australian bank to begin offering customers the ability to buy, sell, and hold crypto assets.
Under the partnership, CBA has been able to design a crypto exchange and custody service that will be offered through a new feature on its Commbank app. CBA plans to provide customers access to up to 10 crypto assets including Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.
The bank will also look to Chainalysis to assist its compliance teams to monitor and mitigate potential threat of crime through crypto asset exchanges.
“We believe we can play an important role in crypto to address what’s clearly a growing customer need and provide capability, security, and confidence in a crypto trading platform,” CBA CEO Matt Comyn said.
“In looking at ways that we can support our customers, we have made the strategic decision to form an exclusive partnership in Australia with Gemini, a global leader with strong security and a track-record of serving large institutions. CBA will leverage Gemini’s crypto exchange and custody service and integrate it into the CommBank app through APIs.”
The black and yellow bank will now kick off a pilot in the “coming weeks” before it progressively rolls out more features to customers next year.
The move further solidifies the bank’s focus on blockchain technology, the technology that underpins cryptocurrency.
Towards the end of last year, CBA along with the National Australia Bank, investment advisory firm Perpetual, and blockchain company ConsenSys Software partnered with the Reserve Bank of Australia to look into the potential use and implications of a wholesale form of central bank digital currency (CBDC) using blockchain.
As part of the collaboration, the project involved developing a proof of concept for the issuance of a tokenised form of CBDC.
The bank also previously completed the delivery of the world’s first bond via blockchain, on behalf of its client, the World Bank.
According to CBA, the “$AUD Kangaroo bond”, Blockchain Offered New Debt Instrument (bond-i), which uses a private Ethereum blockchain, was created, allocated, transferred, and managed through its life cycle solely using distributed ledger technology.
The two-year bond raised AU$110 million.
In September, the Australian Taxation Office (ATO) estimated that there are over 600,000 taxpayers that have invested in digital assets in recent years.
It said its own data analysis shows a dramatic increase in trading since the beginning of 2020.
“The innovative and complex nature of cryptocurrencies can lead to a genuine lack of awareness of the tax obligations associated with these activities,” the ATO said. “Also, the pseudonymous nature of cryptocurrencies may make it attractive to those seeking to avoid their taxation obligations.”
The Australian Transaction Reports and Analysis Centre (Austrac) in late 2017 gained authorisation to extend anti-money laundering and counter-terrorism financing regulation to cryptocurrency exchanges.
As a result, digital currency exchange service providers must apply the same obligations as other financial sector businesses, and are required to identify, manage, and mitigate risks of money laundering, terrorism financing, and other serious crime. They are also required to report suspicious matters to Austrac.
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